8.07.2008

"Field checks from Japan suggest Intel has ordered 20M Atom flip-chip packages for 3Q08 and 25M for 4Q08. This is orders of magnitude more than our modeled 2M and 2.5M units in that timeframe. These figures do sound aggressive to us (and some is likely inventory build) and so we believe a substantive haircut is appropriate. Nonetheless, even at half these levels, Atom is running well ahead of our expectations. We conclude that Intel's relatively aggressive 8.8% 3Q08 revenue growth guidance, while still prone to macro factors, looks more achievable in light of Atom strength".

I may have to give anecdotal evidence in support of Glen Yeung’s report. The lead time for ordering Atom processors from distributors have now gone up to 6 weeks! It's beginning to look like last year with Barcelona but only different. Atom demand has just gone through the roof as if every single technology firm has found some clever use for the low power microprocessor. Hopefully, Intel meets demand for the coming Christmas season. The concern about sales cannibalisation should be limited to computers below the performance range of Core 2 Duo, which as it stands today, equates to all of AMD’s SKUs.